How watertight are your terms and conditions?

Posted on: July 23rd, 2010

Have you got all bases covered when it comes to your terms and conditions? And, once you’ve drawn up some terms and conditions that you’re happy with, how do you get your clients to agree to them?

The exact nature of your terms and conditions will naturally depend on what business you’re in. The terms and conditions I had when I was doing PR are completely different from the ones I now have as a copywriter. Anyhow, the basic principles of why we need terms and conditions are the same for every business.

Why are terms and conditions important?

  • You’re more likely to get paid on time – and that’s good for cashflow.
  • If you do have an outstanding debt, you’re more likely to get it recovered if you’ve set your terms and conditions out clearly.
  • They spell our your business rules and state clearly who is responsible for what.
  • They make you look more professional.
  • They will reduce the likelihood of disputes, limit your liability, enhance your rights and generally ensure you’ve got your backside covered.

What do you need to include?

1. Your payment terms

For example, ’30 days from the date of invoice’.You should also include whether you charge a percentage upfront. I usually charge new clients 50% in advance and I don’t start work until the money is in my account and has cleared. If it’s going to be a long project (eg two months or more) then I state that I’ll invoice 1/3 at the beginning, 1/3 half way through and 1/3 on completion. Helps with cashflow.

2. Any rules that you want  to lay down

For example, the client is responsible for signing off final artwork and for ensuring there are no errors. Or you will add a mark up of x% to any product or service that you buy in on behalf of the client. Or that any travel expenses incurred on behalf of a client will be reimbursed by the client. You get the sort of thing. It’s your business, so you make the rules.

3. The scope of the work

For me as a copywriter, this means stating I will be producing x number of pages, attending y number of meetings and making z sets of amends. I add a sentence that says: “Any subsequent changes to the agreed brief, once the project has started, may incur an additional copywriting fee.”

4. Who owns the copyright

That will be you, unless the client wants to own it, in which case they will need to pay you for it. In the UK, the Copyright, Designs and Patents Act 1988 means that copyright of the work we create remains our intellectual property right. So if you’ve written a website and the client wants to re-use your words for any other use or in any other medium, they will need to pay you a re-use fee. But best of luck in trying to get them to agree to this! It IS the law here but most either don’t realise it or ignore it. (Funny how clients understand that a photographer’s work remains their own but not a copywriter’s…)

Get it in writing!

I always add my terms and conditions to each quote I submit and the first point says: “Work will start when I have received either a purchase order for the quoted amount, or an e-mail confirming your acceptance of the budget.”

Don’t ever rely on a verbal nod when it comes to getting the OK on budgets. You need to have their agreement in writing.

Get their agreement

Your terms and conditions won’t count for anything unless your client sees them in advance and agrees to them. In my terms and conditions, I add a sentence that says: “Your confirmation that you would like me to proceed with the project means you agree to my terms and conditions.”

Not every client is going to agree to every point in your terms and conditions. So you will have to be prepared to negotiate a bit if you want to work with that client. One of my clients has payment terms of 60 days and mine are 30, so we agreed on 45.

When interest rates were high here, I had a clause that said I would charge interest at so many percentage points above the Bank of England’s base rate as a late payment penalty. One client refused to agree to that bit so I agreed to take it out. (They always pay on time anyhow!) If truth be told, I never really enforced the pnealty charge but I included it because some companies make a point of putting invoices with late payment penalties at the top of the pile. Now that interest rates are so low, late payments penalties add up to peanuts, so I’ve taken that clause out.

Disclaimer: The above information is based on my experience of freelancing. I am not a lawyer and circumstances will vary from country to country, so please check with a lawyer to get the most appropriate advice for you.

What do you include in your terms and conditions? And do you find it hard to get clients to agree to them?

3 Responses to “How watertight are your terms and conditions?”

  1. Cookies & Java
    July 23rd, 2010

    A couple of things I’ve seen people mention in the past are:

    1) Termination cost and deliverables if the client cancels the project
    2) Right to claim outstanding costs if the project stalls for a certain time frame

    Something else worth considering is that if you land a large client you may be expected to sign a suppliers agreement document. While this usually contains items outside of your T&C’s such as a non disclosure agreement it can also contain items within your T&C’s such as payment terms and intellectual property rights.

    My own T&C’s are quite light and always appended to quotes. Touch wood, I’ve never had an issue.

  2. Freelance FactFile
    July 23rd, 2010

    Yes, I sent in an invoice recently for work undertaken to date on a project that had been on the back burner for a while. The client paid on time and it seemed to have the right effect – the project is back on stream again and I’ve been working on it today, funnily enough.

    In my terms and conditions, I say: ” Where a client or design agency delays the project, I reserve the right to invoice work undertaken to date.”

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